Mitsubishi Motors Lowers Full-Year Operating Profit Forecast by 30%

According to foreign media reports, on August 27, Japanese automaker Mitsubishi Motors lowered its operating profit forecast for the current fiscal year (April 2025 to March 2026) by 30%, attributing the revision to the impact of U.S. import tariffs, weakened sales expectations, increased sales costs due to intensified market competition, and rising costs related to inflation.

Mitsubishi Motors currently expects its operating profit for the fiscal year ending next March to be 70 billion yen (approximately 475 million US dollars), lower than the previously forecast 100 billion yen.

Image source: Mitsubishi Motors

Mitsubishi Motors Corporation simultaneously revised its global sales forecast down to 869,000 units; net sales were revised down to 2.86 trillion yen, a decrease of 3.1% compared to the previous forecast of 2.95 trillion yen; operating profit was revised down to 60 billion yen, a decrease of 33.3% from the previous forecast; profit attributable to owners of the parent company is expected to decline to 10 billion yen, a significant decrease of 75% compared to the previous forecast of 40 billion yen.

After the news was released, Mitsubishi Motors Corporation's stock price fell by 2%, closing at 401.5 yen.

Takao Kato, CEO of Mitsubishi Motors, stated at the earnings briefing that the revised forecast reflects the challenges the company faces in implementing planned price increases and reducing incentive measures to offset tariff costs. He mentioned that since all automakers are trying to counteract the impact of US tariffs, competition has intensified in markets outside the US, leading to increased selling expenses for Mitsubishi Motors and greater pressure on profitability.

It is reported that Mitsubishi Motors' new performance forecast is based on the assumption that the 15% automobile import tariff rate, agreed upon by Japan and the United States in their bilateral trade agreement last month, will take effect from October.

At the end of July, Mitsubishi Motors announced that its operating profit for the first fiscal quarter (April to June) plummeted by 84% year-on-year to 5.6 billion yen (approximately 35.5 million USD), partly due to a negative impact of 14.4 billion yen from tariffs. During the same period, Mitsubishi Motors' net income was 609.1 billion yen, a decrease of 3% year-on-year. The global automobile sales for the quarter were 194,000 units, remaining flat compared to the same period last year.